More female small-business owners are funding their businesses with credit cards and personal savings, instead of or in addition to long-term bank financing.
That's one finding of a new survey of U.S. female owners released by PNC Financial Services Group, a banking and financial services institution in Pittsburgh.
The survey found that 59 percent of female business owners said they used a business credit card and 44 percent relied on personal or family savings to fund their businesses.
On average, female owners relied on 2.7 sources of business financing. Sources other than a business credit card or personal savings included a line of credit, personal credit card or business loan. Less than 40 percent of respondents said they'd tapped those sources of capital.
Only 41 percent of female owners surveyed said they intended to make a capital investment in their business.
Female business owners often describe themselves as being debt-averse, but not using bank financing can limit their options in a difficult business climate, according to Beth Marcello, director of women's business development at PNC.
Female business owners who "rely strictly on savings and credit cards leave few options to weather downturns without cashing in personal assets or taking a hit to their personal credit history," Marcello said in a statement.
Other survey findings:
• 11 percent of female small-business owners said their businesses were exceeding their expectations.
• 50 percent said their businesses were meeting their expectations.
• 51 percent said they expected their sales to increase.
• 31 percent expected sales to remain the same.
• 41 percent expected to earn higher profits.
• 32 percent expected profits to stay flat.
• 73 percent had no plans to hire full-time employees.
• 63 percent expected no change in the number of their part-time employees.
• 49 percent were pessimistic about the prospects for the U.S. economy.
• 37 percent were pessimistic about their own local economy.
The telephone survey of 1,300 female small-business owners or senior decision-makers was conducted March 30 to May 11, 2011, by Artemis Strategy Group, a brand research, positioning and communications firm in Washington, D.C.
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